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Canada Pension Plan Strategies A
guide to maximizing your benefits. (Lifestyles 55+ magazine … Summer 2005)
Home-Brewed Enjoyment The
joys of making wine and beer at home. (Lifestyles
55+ magazine … March 2006)
A
Taxing Situation Oh
yes, we do pay taxes in
A
Little Piece of Canadiana A Visit
to the Tunnels of
Medical
Expenses and Your Tax Return A
guide to claiming medical expenses on your tax return. (CARP 50Plus magazine … Feb 2004, Lifestyles 55+ magazine …
Spring 2005)
Hole Handicapping Allocating
handicap strokes to golf holes. (Inside Golf
magazine … May 2004, Lifestyles 55+ magazine Spring
2005)
Let It Snow The
pros and cons of buying a snowblower. (Lifestyles 55+ magazine … Winter 2005)
Donor Beware - Donations and Tax Shelter Arrangements If it sounds too good to be true, it
probably is. (Lifestyles 55+ magazine …
January 2006)
Moving Expenses and Your Tax Return A
guide to claiming moving expenses on your tax return.
The Disability Amount and your Tax Return A guide to
claiming the disability amount on your tax return.
The Best Darn Golf Tip You'll Ever Get How fit are you to play this
game, and how fit should you be? (Lifestyles
55+ magazine … March 2006)
The "Squeeze" Caregiver,
and family issues. How are you doing? Are you ready?
Duffer Chronicles "Yes
Donations
and Tax Shelter Arrangements
As concerned Canadians, many
of us donate each year to causes that we think are worthy of our support. These
donations can either be money, or in-kind (something other than money).
Donating items to a charity, such as art, computers, and prescription drugs is
a legitimate way of making a charitable donation. We need to be aware, however,
that certain donation arrangements are considered by the Canada Revenue Agency
(CRA) to be tax shelters, and may be challenged.
Many of us have read about,
or heard advertisements for, donation arrangements whereby taxpayers can invest
in acquisitions to be gifted as charities. These arrangements allow a taxpayer
to buy (without taking possession of) a quantity of items at a bargain basement
price. The items are appraised and donated to a registered charity. The charity
then provides the taxpayer with a tax receipt based on the items' appraised
value. This appraised value is considerably higher than what was paid for the
donated items, resulting in an income tax credit for the taxpayer that is
greater than the price paid.
The government has
systematically attacked tax shelters in recent years. The definition of a tax
shelter in the Income Tax Act was amended in 2003 to include any
property or gifting arrangement for which a promoter represents that an
investor can claim deductions or credits which equal or exceed the cost of the
property less certain benefits within a four year period. As a result of this amendment, the CRA will
generally be suspicious of any arrangement, including
gifting trust arrangements, leveraged cash donations, and buy-low, donate-high arrangements, that allow taxpayers
to obtain a tax advantage in excess of the donation amount. They will disallow
or adjust claims where they find that the donation was not a true gift, or that
the value of the donated property was inflated.
If you are considering making
an in-kind donation to a charity, you should be aware that you could be challenged on transactions that
have one or more of the following characteristics:
·
The advertised arrangements promise to sell items (such as
art, software, or pharmaceuticals) to taxpayers that will be donated
immediately to selected charities for tax receipts that are much higher than
what the person paid;
·
The appraiser is not acting independently of the promoters or
sellers of the arrangement or the charities involved;
·
The fair market value seems too high;
·
The arrangement involves a loan where it's unlikely the
person has to repay the loan because the lender's recourse to collect is
limited, or the provision to settle the loan is by way of something other than
cash payment from the taxpayer.
This is not to say that all donation arrangements will be challenged. There are many in-kind donation arrangements that are acceptable to the CRA. If, however, the arrangement you are considering includes some or all of the characteristics indicted above, you might want to take the following precautions:
·
Be wary of any arrangement where you do not get to see the
property, or the charity has been pre-selected for you;
·
Request confirmation directly from the recipient charity,
independent of the promoter that it has agreed to receive the property and that
it will exercise due diligence regarding the valuation of the property;
·
Review the valuation
or appraisal report. The report should indicate the
professional appraiser is knowledgeable about the property and the market
activity at the time of the donation;
·
Ensure that the appraiser
is a qualified and independent party who is not connected to
the promoters or sellers of the donation. Generally, membership in a
professional association is a good indication of an appraiser's qualifications;
·
Be aware that even if the
arrangement is registered and has a tax shelter number, this does not guarantee that
taxpayers will receive the proposed tax benefits;
·
Before signing anything, obtain
independent legal, and tax advice.
As a taxpayer, you are responsible for the information on your tax returns. Although most tax returns are assessed as filed, the CRA generally has three years from the date of assessment to reassess taxpayers. The fact that investors in some of these tax shelter donation arrangements have not been reassessed should not be interpreted as the CRA's acceptance of the arrangement. Such audits may take more than one year to complete.
In closing I would remind you of the old maxim, "If it sounds too good to be true, it probably is."
"Yes
I played golf today, and really enjoyed myself. I got a little exercise, had a good time with my buddies, and didn't have to pay for the beer after the game. Actually, I usually feel pretty good about golf these days, even when I do have to buy the beer. I haven't been in the nineties now for over a year, and the game has become fun again.
I've been hooked on golf since I was a kid. That's a
long time, and a lot of games ago. Like many who play this game, I'm obsessed
with it. A few years ago, a Royal Canadian Golf Association survey indicated
that there were approximately five million golfers in
As a teen-ager, I worked my summers as a caddy at a
posh golf course just outside of
I was fortunate enough to
be able to semi-retire in my early-fifties, and got serious about the game
again. I joined a golf club, took some lessons, and tried to find the swing
that I had left back in
Then, somehow, somewhere, with no warning, I lost it. Something changed, and I didn't know what it was. My swing didn't feel any different, but my ball was consistently landing thirty to forty yards shorter than it used to, and too often off the fairway. At first, I thought I was just going through a dry spell. I practiced more. I took more lessons. Nothing worked. The game that I had been taking for granted was gone. Golf had become more frustration than fun. I suffered this agony for five more years before it finally sunk in that my game had probably gone to the same place as my younger, stronger, and more flexible body. I either had to quit the game, or lower my expectations. I chose the latter and kept playing (obsession), but it was never the same. Bad golf isn't nearly as much fun.
I'm not sure exactly when it all changed for me, but it was about a year ago. I was surfing the net one day, when I stumbled onto a web site called "SortaGolf", http://sortagolf.manilasites.com. This site, operated by the SortaGolf Association (SGA), is dedicated to recreational golfers around the world. The SGA's position is that since 95 percent of golfers play for recreation only, and since very few of them follow all the rules all the time, a new, structured approach to the recreational game is needed. They have developed a Golfer's Bill Of Rights that includes several revolutionary amendments to the established 'Rules of Golf. These amendments offer the opportunity for recreational golfers to all cheat the same way, thereby evening the playing field.
What a revelation … rules for cheating. This was ground breaking philosophy, and I knew it was going to change the way I approached the game. Here are a few of the SGA's rule amendments:
- One
Mulligan per Round.
Golfers have to manage a lot of stress. One Mulligan per round, from the tee box on any hole provides a stress-reducing cushion, thereby leading to better performance.
- Always Improve Your Lie.
This will give you the best possible chance to play your best golf. There is no good reason to be penalized by poor course maintenance, sadistically placed trees, or the randomness of nature.
- Inside The Leather is “Good”.
"SortaGolf" recognizes the "GIMME", and reaffirms this time-tested practice.
- One-In/One-Out
Principle.
The stroke and distance rules of golf are excessively punitive. "SortaGolf" employs the one-in / one-out principle. If you hit your ball out of bounds, it's one stroke in, and one stroke (penalty) out, the same as a hazard.
- Any
Ball Found is Your Ball.
Nothing is more maddening than searching for a ball that you have hit, and finding five balls, none of which are yours. In "SortaGolf", possession is 9/10 of the law. Any ball you find is deemed yours, free of penalty. Make sure though, that the ball you claim to be yours does not belong to another member of your group.
- Double Bogey is Max.
Why risk shooting a score far in excess of your ability? Today's golf courses are fraught with danger, and it is easy to blow up your score on one or more holes, thereby sacrificing an otherwise stellar round.
So that's it. That's my new game. I don't even feel like I've betrayed the ancient game. I know I'm not playing real golf. I'm playing "SortaGolf", and I'm enjoying myself again for the first time in years. It wasn't hard to convince my golfing buddies that this should be their game too. We can't post our scores, and a few of the purists around the club are upset with us, but that's their problem, not ours. I haven't heard an angry rant, or seen a golf club flying through the air for over a year now. We’re having some fun, getting some exercise, and isn't that really what it's supposed to be all about?
A Taxing Situation
Most Canadians agree that we pay a lot of taxes. To name a few, there is federal income tax, provincial income tax, sales tax, the GST, municipal taxes, as well as government fees and levies for just about everything that is fun and interesting to do. Whether or not we agree with how these tax dollars are spent, we do not have a choice when it comes to paying taxes, and so we do. This discussion looks at the provincial income tax we must pay, and some of the differences in approach that our provincial leaders have taken to get their fair share of the tax pie.
The tax system in
For many years, all provinces
and territories, with the exception of
What TONI has not
done, however, is change the fact that where we live in
- If your income is $50,000.00 and you live in
- If your income is $100,000 and you live in
The following table uses 2003 tax figures. It illustrates the estimated Federal and Provincial / Territorial taxes owed on a given income level. These estimates include tax reductions for Federal and Provincial/Territorial Personal Tax Credits, but do not include other low income tax reductions and / or other Provincial / Territorial tax credits.
|
Income Level |
BC |
AB |
SK |
MB |
ON |
PQ |
NB |
NS |
|
NF |
YK |
NWT |
NVT |
|
$ 25,000 |
3,770 |
3,910 |
4,630 |
4,650 |
3,800 |
5,075 |
4,430 |
4,500 |
4,485 |
4,620 |
3,975 |
3,765 |
3,350 |
|
$ 50,000 |
10,920 |
11,475 |
12,750 |
13,225 |
10,925 |
14,225 |
12,830 |
13,065 |
12,775 |
13,475 |
11,270 |
11,115 |
9,960 |
|
$ 75,000 |
19,475 |
19,900 |
21,925 |
23,125 |
20,025 |
25,000 |
22,650 |
23,000 |
22,900 |
24,000 |
19,800 |
19,700 |
17,850 |
|
$ 100,000 |
29,500 |
28,900 |
31,675 |
33,975 |
30,875 |
36,425 |
33,275 |
34,000 |
34,000 |
35,400 |
29,300 |
29,125 |
26,600 |
A
Little Piece of Canadiana, Underground
Returning from a
trip to
We checked into
our motel and headed downtown for a walk through the city centre. Many things
looked familiar, but it was apparent that
After enjoying a
cappuccino at one of the patio restaurants on
Since 2000,
Chinese
immigration to
Feelings towards
these Chinese immigrants were running strong in
The Passage to
Fortune tour chronicles these Chinese immigrants' life in